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Employers get warning call over RTI

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31st Oct 2013
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The introduction of real time information, including a new electronic messaging system for communicating with HMRC, may strain relations between employers and payroll providers, a credit management company has said.

Penalties for late PAYE returns start from April 2014. Although employers will pay any penalties it will be up to payroll departments or payroll suppliers to ensure that payroll information in compliance with new rules.

“The sheer scale of RTI and the scope for automated penalties in what is a very complex real-time reporting infrastructure leaves the payroll provider highly exposed for all issues that arise,” said CreDec, a company which provides credit management services to SMEs.

Time spent helping customers comply with RTI rules, including providing customers with information to challenge HMRC penalties, could squeeze profit margins for payroll providers, CreDec added.

“Employers need the certainty of a fixed cost for the operation of their payroll - but so does their payroll provider to deliver the same service in real time, including the means to defend HMRC penalty notices and compliance checks. Without it, the accountancy profession in practice and payroll providers risk being bled dry and straining client goodwill, perhaps to breaking point.”

Earlier in October, HMRC started to use an electronic message system to help employers keep their PAYE up-to-date.

The first of these messages will tell employers that they appear to have submitted a late Full Payment Submission (FPS).

Employers who receive one of these messages must ensure that they get their business ready to submit their PAYE returns on time from 6 April 2014 in order to avoid potential in-year penalties in 2014-15.

In September, HMRC sent letters to 167,000 employers who have missed one or more deadlines for reporting PAYE information in real time.

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Replies (3)

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By Liz M Falconer
04th Nov 2013 12:58

HMRC Messaging late returns

If the Messging is as accurate as the business dashboard then we could all be in a lot of trouble. I have been told already to ignore the figures on the dashboard by HMRC as they are incorrect. Ive also been told we owe money on one of the submissions when the figures they have are different from the copy of my submission and the fully reconciled payments.

Before they start to do this they should get their house in order and ensure their system is working properly, they already waste a huge amount of Companies time

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Morph
By kevinringer
04th Nov 2013 13:25

Electronic messaging

Sounds good - but what form will these messages take? http://www.hmrc.gov.uk/news/electronic-notifications.htm states how they will be communicated to employers. I guess many employers will use payroll agents. Will agents be aware that a message has been sent and if so, how will it be dealt with? HMRC's page admits some commercial software might not be able to receive the messages. Do we know which products?

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By gary.ging
05th Nov 2013 08:43

Sent via DPS

These messages are sent via the Data Provisioning Service (DPS), which is the same service that sends the electronic tax code and student loan messages, so you would pick the new messages up in the same way, assuming your payroll software supports the new message type.

Sage Payroll supports these messages and you can see them within the Secure Mailbox option.

Regards

Gary

Sage (UK) Ltd 

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